181 replies to this topic

[dharma]

a reminder: "Destroyers seize gold and leave to its owners a counterfeit pile of paper. This kills all objective standards and delivers men into the arbitrary power of an arbitrary setter of values. Gold was an objective value, an equivalent of wealth produced. Paper is a mortgage on wealth that does not exist, backed by a gun aimed at those who are expected to produce it. Paper is a check drawn by legal looters upon an account which is not theirs: upon the virtue of the victims. Watch for the day when it bounces, marked, ‘Account overdrawn.’ Ayn Rand

[dougie]

indeed
your dust might glitter after all

Miners continue to reek as gold and silver climb ever higher, something's gonna give here.

Senor

[mss]

$50 acts like a magnet on silver and very achievable before this rally is toast and a mega correction occurs.

$54.64 FWIW

Best to you,
mss

[inamosa]

$50 acts like a magnet on silver and very achievable before this rally is toast and a mega correction occurs.

$54.64 FWIW

Best to you,
mss

Thank you, Scott.

Yes, I wouldn't be surprised to see $50 slightly exceeded before the large bull market correction (15-25% in gold) that I speculate is coming after this rally terminates.

It is very typical for price to exceed a round number level before gold and silver tops.

[dharma]

$50 acts like a magnet on silver and very achievable before this rally is toast and a mega correction occurs.

$54.64 FWIW

Best to you,
mss

Thank you, Scott.

Yes, I wouldn't be surprised to see $50 slightly exceeded before the large bull market correction (15-25% in gold) that I speculate is coming after this rally terminates.

It is very typical for price to exceed a round number level before gold and silver tops.

now, make no mistake i am bullish . however , when i hear these #s for silver and then a non confirmation in the miners. they are doing squat. it get me very uneasy.
dharma

[inamosa]

$50 acts like a magnet on silver and very achievable before this rally is toast and a mega correction occurs.

$54.64 FWIW

Best to you,
mss

Thank you, Scott.

Yes, I wouldn't be surprised to see $50 slightly exceeded before the large bull market correction (15-25% in gold) that I speculate is coming after this rally terminates.

It is very typical for price to exceed a round number level before gold and silver tops.

now, make no mistake i am bullish . however , when i hear these #s for silver and then a non confirmation in the miners. they are doing squat. it get me very uneasy.
dharma

Understandable.

Between here and $50, assuming silver is going to $50 or slightly above $50, I expect at least one if not two or three shakeouts. It will not be easy to hold. For example, I think gold could drop say 2.5-3.5% and silver could drop say 10% at any moment here without disturbing the trend of this rally. In fact, I think such a shakeout may be coming within the next 5-10 trading days.

[mss]

Between here and $50, assuming silver is going to $50 or slightly above $50, I expect at least one if not two or three shakeouts. It will not be easy to hold. For example, I think gold could drop say 2.5-3.5% and silver could drop say 10% at any moment here without disturbing the trend of this rally. In fact, I think such a shakeout may be coming within the next 5-10 trading days.

We agree.

The first I expect around 43-44+/- then a run to 48ish, pause, then up. The full decline IMO will last into 2013-14. Depending on some politics--- we cannot and must not discuss.
mss

[inamosa]

Between here and $50, assuming silver is going to $50 or slightly above $50, I expect at least one if not two or three shakeouts. It will not be easy to hold. For example, I think gold could drop say 2.5-3.5% and silver could drop say 10% at any moment here without disturbing the trend of this rally. In fact, I think such a shakeout may be coming within the next 5-10 trading days.

We agree.

The first I expect around 43-44+/- then a run to 48ish, pause, then up. The full decline IMO will last into 2013-14. Depending on some politics--- we cannot and must not discuss.
mss

Okay.

I do not anticipate such a long and protracted correction. My expectation is that once gold and silver top out in this rally, they will bottom and find their footing again within 4-7 months, although it could easily be a year or two before they start making all-time highs again.

[dharma]

Between here and $50, assuming silver is going to $50 or slightly above $50, I expect at least one if not two or three shakeouts. It will not be easy to hold. For example, I think gold could drop say 2.5-3.5% and silver could drop say 10% at any moment here without disturbing the trend of this rally. In fact, I think such a shakeout may be coming within the next 5-10 trading days.

We agree.

The first I expect around 43-44+/- then a run to 48ish, pause, then up. The full decline IMO will last into 2013-14. Depending on some politics--- we cannot and must not discuss.
mss

Okay.

I do not anticipate such a long and protracted correction. My expectation is that once gold and silver top out in this rally, they will bottom and find their footing again within 4-7 months, although it could easily be a year or two before they start making all-time highs again.

ok, we are all conjecturing, based on our work.
i tend to see it like alysomji, i think we have a large shakeout into the summer and then the 4th quarter and 1st quarter look bullish again. i think things get more compressed and faster. new highs in the metals will be a frequent occurrence as the unraveling gets faster. the jig is up. faith in fiat is gone. the latest i see the end to the bull is 2016 and it would not surprise me in the least if it was sooner. the last impulse is quick. take a look @the previous bull(of course it doesnt have to happen the same , but the idea will be similar.human nature does not change). the move that we are presently in reminds me of 79 and jimmy
thought so also. any way there is my 2c. uncomfortable and selling are 2 different things for me, i suspect that @some point soon the miners get mojo. this coming week there are a slew of major astro events that can cause a blast here we are over 1480 and not one limit up day yet. it is a slow grind. i have traded these markets in full expression. i remember it was trying on my much younger nerves. not so now. i watch, drink my morning dong ding tea. imho, i think selling silver here no matter where it tops is selling out years early. and few will buy it back. they may price chase later. its like a boxer , you have to have sound mechanics. because when this thing gets mojo, one either misses it or price chases. sitting is for the pros. few will make fortunes , they just dont realize what they are dealing w/ here. what the opportunity is the metals have a couple of hundred % left in them . i think the miners could have a thousand % left in them. again my 2c. one thing i do on my miners is keep it in % terms , this way i can see very quickly where the real movement is. its more exact then price change.

take a look @ what the junior did last time. i made good scratch in the metals , but i made much more in the miners.
dharma

[inamosa]

take a look @ what the junior did last time. i made good scratch in the metals , but i made much more in the miners.
dharma

There's no doubt that if you pick the correct miners and sit on them to near the top, you will make a bundle more than anyone else. No doubt at all. It's much easier said than done, though, as compared to holding the metals.

The nice thing about the metals is you can take on enough leverage through futures (from which, thanks to our irresponsible financial system, one can get about as much leverage as they could ever hope for) to compensate for the fact that on a non-levered basis they usually underperform miners. I know some are not comfortable with trading futures due to concern about the collapse of paper but for those of us that are (or are for the time being...if/when paper gets closer to the brink of collapse we'll have to talk again), it is my preferred method of playing the gold and silver market since the returns are much smoother and can exceed the returns of many miners due to the low margin required for holding gold and silver futures contracts.

Based on what I've seen to this point, I would rather be leveraged long the metals through futures than simply long miners (the latter I find very volatile compared to the returns they provide, and also I do not have time to research...and I know there are many crooks in the biz and many factors one has to look at with each company, so one has to do their homework when buying individual miners). One could consider junior mining ETFs like GDXJ and SIL, though, if one is so inclined to not using futures but still doesn't have time to research individual miners. If I ever have a concern about a collapse in the futures market, I will probably move over to ETFs like these.

I also think we may be seeing a permanent shift as far as how miners are treated. No doubt, they will catch up to the metals at some point by more than they have at least (as they have depressingly underperformed to this point), but clearly many average joes prefer to use the metal ETFs and metal futures to play gold and silver nowadays. In the '70s many people were forced to buy mining companies to get exposure to gold and silver. Today there's many ways to get exposure to gold and silver and one doesn't need to bother to buy individual shares (although, as I said earlier, if you manage to make the right picks you could potentially beat everyone else in terms of returns...much easier said than done, though).

--

Regarding phase 3 of this secular bull, I tend to think it will happen after the next eight/nine year cycle low (2016? 2017?)...will probably be a 1-2 year period that is just completely parabolic (think late 1998 to early 2000 in the Nasdaq, or 1979-80 in gold). 2017-2018 is thus approximately when I'm thinking the peak will come but we'll have to wait and see. No one can say for sure but some pretty good guesses can be made. My studies of past commodity bulls indicate that they very commonly last 15-18 years. The last one was ~1965-80 if you use mining stocks as your measure (as gold was not floating until 1970).

Edited by alysomji, 16 April 2011 - 12:15 AM.